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Internet Google Sued for Deceptive Tactics
Jason Mick (Blog) - September 11, 2007 11:07 AM
Print E-mail del.icio.us 30 comment(s) - last by Spivonious.. on Sep 12 at 9:35 AM
Australian courts are seeing a world-first trial pending against Google that alleges that the search giant used deceptive business practices by selling off top search positions

Search giant Google is used to hearing good news, as its phenomenal growth continued, as it competitors such as Yahoo have shrunk.

However, Google received some bad news yesterday when the Australian Consumer and Competition Commission (ACCC) announced that it was taking a world-first legal action in charging Google in a Sydney, Australia Federal Court.  The ACCC accuses Google of using deceptive business tactics, where it will sell top search spots on its internet search engine for large fees.

It alleges that Google tries to market itself as a purely "organic" search engine, based on traffic, but instead directs much of its traffic based on prioritization, controlled advertising revenue.

Additionally the ACCC has another major legal accusation against Google. Online car retailer Trading Post breached the Trade Practices Act in 2005 when it paid Google to use the names of competitor NSW car dealerships Kloster Ford and Charlestown Toyota as hyperlinks to its own site.  These links appeared in Google's sponsored links section, and the resulting pages bore no affiliation to the Trading Post's competitors.

Kloster Ford filed a complaint when it discovered this partnership.

Trading Post created the links with AdWords, a Google commercial program that sets up hyperlinks.

Google Australia spokesman Rob Shilkin later responded to the claims by stating that the company remained committed to providing relevant information to search engine users.  The case is the first case of this nature against Google to reach a Federal Court.

Google has tried in recent years to promote itself as the voice of freedom of information on the web through its Google Earth service, and its recently release Google News service, among other projects, which makes these legal allegations particularly troublesome.

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Tempest in a teapot
By masher2 (blog) on 9/11/2007 11:51:29 AM , Rating: 2
So when I go to the Google search service, and type in "Kloster Ford", I'm presented with both a link to Kloster Ford (provided without any charge to me or the company itself) as well as a clearly-labelled "Sponsored Link" to one of the company's competitors?

How on earth anyone could find this damaging to consumers or fair trade is beyond me.




RE: Tempest in a teapot
By Trisagion on 9/11/2007 12:28:26 PM , Rating: 1
What the article says is that Trading Post used Google Adwords to put up links with the names 'Kloster Ford' and 'Charlestown Toyota' that sent users to their own site.

That is illegal.


RE: Tempest in a teapot
By masher2 (blog) on 9/11/2007 1:02:35 PM , Rating: 2
> "That is illegal. "

By which law? It's not even a trademark violation. Neither Google nor the keyword purchaser is displaying the mark in conjunction with their own products. Nor does there appear to be any reasonable chance of confusing the consumer. Is there really anyone here who believes someone will accidently buy a car from the Trading Post, thinking they were shopping at Kloster Ford?


RE: Tempest in a teapot
By JasonMick (blog) on 9/11/2007 1:15:13 PM , Rating: 3
I believe it is illegal to put up fake website impersonating a corporate entity.

Now I agree with the intelligence check principle, but a certain amount of customers might click the fake link, and depending on what they posted to it, be disuaded from buying a car at the place (for instance if the fake website listed higher prices than their competitors).

I think most users assume that a sponsored link to a page is a link to the party appearing in the website title. For example, if I clicked a sponsored link that said "CNN News", I would probably assume that it is CNN News I am going to. I might notice the url up top and realize wait...cjb.bobpage.net...thats not CNN..but many people wouldn't.

If I paid Google to sponsor a fake Fox News site, and then put up a page with a bunch of fake news stories, Fox would probably try to sue me and Google =P

Similarly I can see why this dealership was angry.

Whatever legal gray area there is, the illegality of the action is reinforced by the fact that they used the company's name in the page title, and had a description that used the company's name and made it sound like the company's page as well.

Another dangerous thing about Google not monitoring their advertising content, is that spammers/virus writers could pay Google using fake identities to post links which posed as a common household name like "ABC News" or "Dailytech" and link to a page which contained adware/trojans/etc. If they wanted to be really sneak, they could even copy the page for the day, to make it look real.


RE: Tempest in a teapot
By masher2 (blog) on 9/11/2007 2:38:25 PM , Rating: 2
To be clear, my original post was referring to "sponsored links" appearing on a Google search. Nothing deceptive at all there.

In the case of Google adwords, the issue is admittedly a bit less clear cut. When you see hyperlink labelled "Kloster Ford", there is some expectation that the link actually takes you to that site.


RE: Tempest in a teapot
By TomZ on 9/11/2007 2:54:48 PM , Rating: 2
quote:
I believe it is illegal to put up fake website impersonating a corporate entity.

That's not what's going on here - there's no "fake website," nor any expectation that the ad click-thru will take you to that company's web site.

What has been described is actually very common - I have personally seen it tons of times. And there is no reason for it to be illegal, so long as you don't use somebody else's registered trademark as keywords.


RE: Tempest in a teapot
By creathir on 9/11/2007 1:33:05 PM , Rating: 2
The Google ad would be akin to a TV spot that said "Make sure when you buy your next car, buy from the Trading Post or Kloster Ford! Our address is... <Gives Trading Post address>"

This is not something that is illegal. No trademarks violated. At best you could make a case that they falsely used the DBA of Kloster Ford, but that is a stretch. They are not defaming the dealership or anything like that. This would also be like building your dealership down the road from the Kloster, Kloster advertising, and Trading Post getting customers who mistakenly go to the wrong place.

Nothing illegal here...
I usually despise Google, but in this case, they are in the right.

- Creathir


RE: Tempest in a teapot
By Viditor on 9/12/2007 3:54:04 AM , Rating: 2
quote:
By which law?

Australia's Fair Trade Practices Act...remember that this is NOT the US.


RE: Tempest in a teapot
By Spivonious on 9/12/2007 9:31:53 AM , Rating: 2
At the very least, it's false advertising.


RE: Tempest in a teapot
By JasonMick (blog) on 9/11/2007 12:30:34 PM , Rating: 2
From the quoted article:

"These hyperlinks appeared in a shaded area titled "Sponsored Links" at the top of the results page, but appeared to be the dealerships' official sites, or at least affiliated with the dealerships"

It would not be their sponsor hadn't impersonated these other websites, and put up fake links. They weren't just putting up their own link.

I know a lot of click traffic would likely be diverted by these "dirty click" tactics.

Google as a business has a responsibility to ensure within reason that its advertising partners are not abusing other company's copyrights or trademarks in underhanded business campaigns such as this.


RE: Tempest in a teapot
By theapparition on 9/11/2007 12:31:55 PM , Rating: 2
quote:
How on earth anyone could find this damaging to consumers or fair trade is beyond me.

Your problem is that your rational. There is no logic when dealing with irrational people (or women! :P)


RE: Tempest in a teapot
By webdawg77 on 9/11/2007 12:32:40 PM , Rating: 2
quote:
There is no logic when dealing with irrational people (or women! :P)


True that!


RE: Tempest in a teapot
By carl0ski on 9/11/2007 11:05:47 PM , Rating: 2
I hate these lawsuits

If i go to a Department Store and ask for a Sanyo branded TV
The sales man convinces me that Samsung or Panasonic is a better choice.

Is that taking the Sanyo name and directing me to a different brand illegal?

Are all sales men that suggest better alternatives criminals?


Curious
By SandmanWN on 9/11/2007 1:30:32 PM , Rating: 2
How can you sue a search engine for the way its searches show up? Not only that but how do you sue a voluntary website? No one is forced to use google. There are many other sites out there that offer the same services. Where do these people get off telling google how to display the search results of the companies that pay to advertise there?

It just seems silly to me. Thats my personal opinion anyway.




RE: Curious
By A5un on 9/11/2007 3:34:04 PM , Rating: 2
So if your someone sat in a car that had faulty tires which blew up and killing all passengers in the car, then that's too bad? Shoulda got some other brand of tires, as there are other tire manufactures that offer the same size of tires?


RE: Curious
By TomZ on 9/11/2007 3:52:56 PM , Rating: 2
Oh, was someone killed by the allegedly deceptive links? I missed that in the article.

This is possibly just a case of false advertising, not product liability or negligence. Not really the same thing.


RE: Curious
By A5un on 9/11/2007 4:35:31 PM , Rating: 1
Who said someone was killed by the "allegedly deceptive links?" I don't think I ever mentioned that...I could be wrong, but I can't find it...People like to infer a lot of things these days.

In any case, I was commenting on the fact that him, and a lot of other people, like to use the idea of voluntary involvment as a cover. What the corporation does with this cover is not the point, but the fact that some people use this to blantantly excuse a corporation of its responsibility to their consumer is the whole point. Legality aside, wasn't there something called business ethics?


RE: Curious
By TomZ on 9/11/2007 5:15:52 PM , Rating: 3
Uh, I was just saying I don't get your analogy.


RE: Curious
By SandmanWN on 9/11/2007 5:11:34 PM , Rating: 2
I don't know what tires blowing up and killing people have to do with anything I asked about... Your point was so off topic I just went glassy eyed. eh


RE: Curious
By A5un on 9/11/2007 5:28:47 PM , Rating: 2
Hrm, maybe I should rephrase?

Let tire blown ups or alledgedly false advertisement = X
Let voluntary involvement = Y

Your claim that since Y is valid to X is okay to occur is an irresponsible claim.


RE: Curious
By SandmanWN on 9/11/2007 9:49:26 PM , Rating: 2